Standards of Practice & Conduct

PREAMBLE: We, the Members of the Association of Industrial Real Estate Brokers, recognize and appreciate our obligations to continually strive to become and remain informed on issues affecting industrial real estate and, as knowledgeable professionals, willingly share the fruit of our experience and study with others.

We also recognize and appreciate that cooperation with other real estate professionals promotes the best interests of those who utilize our services.  Accordingly, we urge:

1. exclusive representation of clients;
2. not attempting to gain any unfair advantage over our competitors;
3. refraining from making unsolicited comments about other practitioners;
4. continually educating our clients, customers, the public and each other as to the best standards and practice of industrial real estate brokerage and related services; and
5. rendering any opinions or information in an objective, professional manner, uninfluenced by any personal motivation or potential advantage or gain.

To eliminate practices which may damage the public or might discredit the real estate profession, provide guidelines for the appropriate conduct of our business on a fair and consistent basis, and in the spirit of mutual cooperation, desire to maintain the highest level of professional standards possible, and the need to properly and fully serve our clients, customers, the public and each other, we hereby adopt and enact these Standards of Practice and Conduct, effective as of this 11th day of February, 1997.

GENERAL

1. All members (“Members”) of the Association of Industrial Real Estate Brokers (“Association” or “AIRE”) shall have the obligation to conduct their activities and business in accordance with the By-Laws of the Association (“By-Laws”), these Standards of Practice and Conduct (“Standards”), and in compliance with the Illinois Real Estate Law as may be amended from time to time (“Illinois Law”).
2.  Definitions.  The following definitions shall apply to these Standards:
   1. “Association” or “AIRE” means the “Association of Industrial Real Estate Brokers”.
   2. “Authorized Representative” means a person employed by or apparently employed by a Client or Prospect to deal with a Member in connection with the sale, purchase or lease of a Property, but does not necessarily mean that such person has authority to sign for or bind the Client or Prospect to any Transaction.  A Member shall make reasonable inquiry into the actual authority of such person to bind the Client or Prospect.
   3. “Managing Broker” means an individual, partnership or corporation, other than a real estate Broker, as defined in the Illinois Real Estate License Act of 2000, with whom a Member is employed or associated.
   4. “By-Laws” means the current By-Laws of the Association of Industrial Real Estate Brokers, which may be amended from time to time.
   5. “Client” means a person, entity or concern, as applicable, who is represented by a Managing Broker, Member or Broker under a written agreement for brokerage services.
   6. “Exclusive Listing Agreement” or “ELA” means a written agreement under which a Managing Broker, Member or Broker, as applicable, has the Exclusive Right to Sell and/or Lease one or more Properties.
   7. “ERTR” means a written agreement under which a Managing Broker, Member or Broker, as applicable, has the Exclusive Right to represent one or more persons, entities or concerns in the acquisition (by purchase, lease or otherwise) of Property.
   8. “Exclusive Agent” means the Managing Broker (or Member or Broker, if applicable) specified in an ELA or ERTR.
   9. “Illinois Law” shall include, but not be limited to: the Illinois Real Estate License Act of 2000 (Articles 1-4, inclusive) (hereinafter the “Act”); the Illinois Commercial Real Estate Broker Lien Act; Illinois Rules for the Administration of the Real Estate License Act of 2000,; and all applicable statutes, rules, regulations and case law, as amended from time to time.
   10. “Member” means an Active, Associate or Honorary Member as defined in the By-Laws.
   11. “Owner” means the Owner of record of Property.
   12. “Property” means improved or unimproved real estate used or intended to be used in whole or in part for industrial purposes.
   13. “Prospect” means a prospective buyer, tenant, or subtenant of Property, but one who is not a Client.
   14. “Broker” means an individual, other than a real estate Managing Broker (as defined in the Act), who is employed by a real estate Manaing Broker or is associated by written agreement with a real estate Managing Broker as an independent contractor and participates in any activity described in the definition of a “Broker” under the Act.
   15. “Tenant” means a person, entity or concern leasing Property.
   16. “Transaction” means the carrying on or conducting of a business, negotiation or activities involving the sale, lease or exchange of one or more properties to a conclusion or settlement.
3. A. These Standards shall apply to any Real Estate Transaction if one or more of the Brokers directly involved is a Member. If one or more of the Salespersons directly involved is not a Member, then the application of these Standards shall be determined on a case-by-case basis.B. In the event of any violation of these Standards by any Member, the provisions of the By-Laws shall be applicable, and all rights and remedies of the Members and of the Association available under the By-Laws shall be enforced by the Association.C. These Standards may only be amended as provided in the By-Laws.

   D. These Standards are not intended to supersede any statutory or common law rights of Members, and in the event of any conflict, the law, as applicable, shall prevail.

4. The use of masculine, feminine or neuter pronoun in referring to a Client, Member, Owner, Prospect or other party shall be deemed a proper reference even though such party may be an individual of the opposite gender, a corporation, a partnership, or a group of individuals, partnerships or corporations, or any other business entity.
5. Member shall not disparage the business practice of others.
6. A Member shall not quote a sale price or a lease rate which is net of commission unless full disclosure is made to all parties involved.
7. A Member shall not discriminate based on race, religion, ethnic origin, and/or gender.
8. The phrase “Principals Only” or any other language with similar intent shall not be used in marketing or advertising properties.
9. Where appropriate, Members shall announce the details of the Transaction in a timely manner.  The role of all Managing Brokers involved in the Transaction shall be included in all press releases and public announcements.
10. Nothing contained herein shall be construed to prohibit a Member who is not otherwise commissionable in a Transaction from consulting with, working for, or being compensated by parties to the Transaction in connection with the same Transaction and in which Transaction one or more other Brokers are involved, provided the Member makes no claim to any portion of the commission to be paid in connection with such Transaction.  The foregoing shall apply whether or not an ELA or ERTR exists.
11. In obtaining or attempting to obtain either an ELA to sell, lease, or sublease any Property on behalf of the Owner or Tenant of the Property or an ERTR on behalf of a Prospect, a Member shall not violate the rights, if any, of other Brokers who have worked on the same Transaction with an Authorized Representative of the Owner, Tenant or Prospect.  A Member shall make reasonable inquiry into the actual authority of such Authorized Representative.
12. Members shall not provide misleading information.
13. Members shall conduct their business in an ethical and professional manner and shall not allow any Client or Prospect to dictate their ethical behavior, nor lower their ethical standards for any reason.
14. Members shall not knowingly or intentionally inject themselves into nor accept an invitation to complete a Transaction started by another Broker working with an Authorized Representative of a Client or Prospect.  However, in certain circumstances, and upon the written request of the Client or Prospect, a Member may complete a Transaction on which another Broker has done some work, for example:
    1. A reasonable break in continuity due to the passage of time;
    2. A Broker’s refusal or unwillingness to submit offers or supply requested information to Clients or Prospects; or
    3. A substantial change in the nature of the Transaction, ownership or leasehold interest in the Property.
15. Members shall respect the confidentiality requests of other Members.
16. If there is a dispute between two or more Members, then the dispute should be resolved between the disputing Members and, if necessary, the Client or Prospect.

PROSPECT REPRESENTATION

17. Whenever possible, a Member should secure, on behalf of such Member’s brokerage company, a written ERTR with a Prospect seeking to acquire a Property.  The ERTR shall set forth the following:
    1. the parameters of the assignment,
    2. the responsibilities of the Managing Broker,
    3. the rights of the parties,
    4. the term of the ERTR,
    5. the compensation arrangement,
    6. a list of all exceptions or exclusions,
    7. that all contacts with Owners and their agents are to be made through the Member,
    8. that all principals, employees and agents of the Prospect who have knowledge about and authority with respect to the real estate requirements of the Prospect will be informed about the ERTR, and
    9. that the Managing Broker is the Exclusive Agent of the Prospect.
18. Member with (or without) an ERTR shall not discriminate for or against Properties submitted to the Client (or Prospect) by requesting commissions other than those offered by the listing agent or set forth in an ERTR without both disclosing any such arrangements to the Client (or Prospect) and receiving the Client’s (or Prospect’s) acceptance.
19. A Member shall not identify itself or its brokerage company as exclusively representing a Prospect unless such Member or brokerage company has a fully executed written ERTR with such Prospect. Upon reasonable request, written verification of the ERTR shall be provided.
20. If a Property is excluded from a Member’s ERTR, then a Member shall not knowingly or intentionally inject themselves into a Transaction related to the excluded Property.
21. A Member shall not work directly with a Prospect who has an ERTR with another Broker unless the Member’s work or the specific Properties submitted by the Member are excluded from the ERTR or are part of an unrelated Transaction or service.

EXCLUSIVE PROPERTY REPRESENATION

22. Whenever possible, a Member should secure, on behalf of such Member’s brokerage company, a written ELA on behalf of an Owner or a Tenant.  The ELA shall identify the Property and shall set forth the following:
    1. the parameters of the ELA,
    2. the responsibilities of the Managing Broker,
    3. the rights of the parties,
    4. the term of the ELA,
    5. the compensation arrangement,
    6. a list of all exceptions or exclusions,
    7. that all contacts with the Owner or Tenant and their agents are to be made through the Member, and
    8. that the Managing Broker is the Exclusive Agent of the Owner or Tenant.
23. A Member shall not accept or cause its brokerage company to accept a net listing which provides for the agent to receive, as the commission, all or any part of money in excess of a price from an Owner or Tenant.
24. A Member with an ELA shall promptly disseminate information to all other Members by mail, public notice, newspaper ads, signs, or electronic mail regarding the Property, consistent with the Client’s best interest and upon appointment as Exclusive Agent, unless the ELA provides otherwise.  Upon the request of another Broker, a Member shall promptly supply all pertinent and appropriate information concerning the ELA.
25. Member shall not engage in an activity which will adversely affect an agency relationship of another Member.
26. Member with an ELA shall not engage in an activity which will adversely affect the relationship of a Member and the Member’s Prospect.
27. Then requested, the commission and all relevant terms of the ELA shall be promptly disclosed by the Exclusive Agent. As an Exclusive Agent, a Member or its brokerage company shall not discriminate in the commission terms generally offered to cooperating Brokers.
28. If a Member or its brokerage company has the right under the terms of an ELA to commission protection beyond the expiration date of the ELA, or within the time required after expiration of the ELA and furnishes to the Owner or Tenant a written list of all Prospects, which list may include Prospects introduced to the Property by another Broker, then the Member and all Brokers who have introduced Prospects to such Member shall continue to cooperate with the ELA Member during the extended term. Upon furnishing the Prospect list to the Owner or Tenant, the Member shall advise each Broker whose Prospect has been identified to the Owner or Tenant of the terms of the extended protection period. Upon the termination of the Member’s ELA and extended protection period, or if the Member fails to report a Broker’s Prospect to the Owner or Tenant as provided above, such Broker(s) shall be free to work directly with the Owner’s or Tenant’s designated representative.
29. If a Member’s ELA has expired and the Member receives an inquiry on the Property from a Salesperson, the Member shall promptly inform the inquiring Broker that the ELA has expired.
30. Member with an ELA to sublease a Property must promptly reveal the sublease nature of the ELA to other Brokers inquiring about the Property.  All marketing information distributed to Brokers must disclose the nature of the sublease agency.  A Member with a Prospect may, although the Member is not obligated to, work with the sublessor’s Exclusive Agent for any term beyond the sublease term on the Property.
31. Unless otherwise agreed upon by the parties involved, a Member shall not initiate contact with an Owner or Tenant regarding a Property which is the subject of a valid ELA with another Broker.

NON-EXCLUSIVE PROPERTY AND PROSPECT REPRESENTATION PROCEDURES

32. Immediately upon inquiry regarding a Property or the representation of a Prospect, a Member shall fully disclose to another Broker that the Member is not the Exclusive Agent for either a Property or a Prospect.
33. A Member shall not advertise Property information, or a Prospect’s requirements, when the Member is not the Exclusive Agent for the Property or the Prospect, without the Owner’s or Prospect’s consent.
34. When a Member agrees to cooperate with a Broker who is not the Exclusive Agent for a Property or a Prospect, the obligation of the Member to cooperate with that Broker shall not terminate unless the Owner or Prospect grants an ELA to another Managing Broker, and no previous agreement or exclusion to the ELA exists.